Trade unions are believed to have experienced a renewal since the 1990s. Viewed against the backdrop of mass investment culture, this revitalization does not refer to union members’ role as workers, but to their role as active shareholders. Union organizations, such as trade union organizations, union-based pension funds, individual union members and labour-oriented investment funds, have become increasingly cognizant of their powers as ‘owners’ of vast amounts of social security capital (see Chapters 1 and 2), or what some commentators have referred to as ‘labour’s capital’ (Fung et al., 2001). Unlike traditional forms of union activism, which have relied primarily on strikes and picketing to gain concessions from management to improve workers’ welfare, the new activism focuses on ensuring that good corporate governance practices are met by way of proxy voting, dialogue and negotiation with management and other shareholders. By flexing their financial clout through shareholder oversight and influence on corporate decision making, proponents of this new activism believe that unions will make more inroads in securing workers’ interests than by engaging older strategies to change corporate behaviour (Schwab and Thomas, 1998). In other words, there is an implicit assumption that the maximization of shareholder value, which lies at the heart of corporate governance theory and practice (see Chapter 3), will lead to improved welfare benefits for all, including workers. Despite the enthusiasm for this so-called ‘new activism’ and its ability to effect positive social change, observers have conceded that workers still do not exercise meaningful control over their capital (Baker and Fung, 2001; Hebb, 2001). This lack of control is particularly evident in the growing insecurity of retirement income and the ever-widening gap between executive pay and compensation packages on the one hand, and workers’ wages on the other (Weller and White, 2001; Brennan, 2005, 2008; Mishel et al., 2007). Two major and overlapping perspectives dominate the explanations regarding the limits to union-led shareholder activism: (1) the weak corporate governance perspective; and (2) the myopic market model. The first explanation locates the majority of blame with the ongoing passivity of shareholders to ensure that management adheres to good corporate governance practices, thereby working toward maintaining shareholder value. The second explanation, the myopic market view, finds fault with the short-term and speculative nature of money managers and

financial markets. The shortsightedness by the financial community has, in turn, placed pressure on corporate management to focus on improving the price of company shares as opposed to keeping an eye on the long-term benefits of reinvesting in production processes, worker training and so forth – all of which aid in improving the welfare of workers (Baker and Fung, 2001; Brennan, 2005). My main thesis in this chapter is that while the two explanations mentioned above are helpful in understanding why organized labour continues to wield little control over its pension fund capital, the accounts fail to capture some of the deeper causes of the limits plaguing the new activism, specifically those rooted in the contradictions and power relations of capitalist society. As such, these accounts explain away the underlying causes of the limits to union-led shareholder activism, as well as the depoliticizing tendencies inherent in the corporate governance doctrine. I develop this argument in four main sections. The first section maps the rise and significance of the debates about labourshareholder activism, and establishes their relevance to changes in both financial markets and corporate governance. The second section identifies the chief limitations to union-led shareholder activism since its rise in the early 1990s and explores the two major perspectives that have been used in the debates to explain the weakness surrounding this novel form of activism. The third section critically evaluates these two explanations, aiming to transcend mainstream analyses by identifying the underlying causes that have led to the weakness in union-led shareholder activism. The fourth section concludes by drawing out the analytical and political limits to the new activism.